2. POPULATION
2.1- A population of 78.7 million (2015, TurkStat)
2.2- Largest youth population compared with the EU (Eurostat)
2.3- Half the population under the age of 31 (2015, TurkStat)
2.4- Young, dynamic, well-educated and multi-cultural population

3. QUALIFIED AND COMPETITIVE LABOR FORCE
3.1- Over 29.7 million young, well-educated and motivated professionals (2015, TurkStat)
3.2- Increasing labor productivity
3.3- Approximately 733,000 students graduate annually from over 193 universities (2015, CoHE)
3.4- More than 950,000 high school graduates with around half from vocational and technical high schools (2015, Ministry of National Education)

4. LIBERAL AND REFORMIST INVESTMENT CLIMATE
4.1- The 2nd biggest reformer among OECD countries in terms of its restrictions on FDI since 1997 (OECD FDI Regulatory Restrictiveness Index 1997-2015)
4.2- Business-friendly environment with an average of 7.5 days to set up a company, while the average in OECD members is more than 15 days (World Bank Doing Business Report 2016)
4.3- Highly competitive investment conditions
4.4- Strong industrial and service culture
4.5- Equal treatment for all investors
4.6- Around 46,800 companies with international capital in 2015 (Ministry of Economy)
4.7- International arbitration
4.8- Guarantee of transfers

5. INFRASTRUCTURE
5.1- New and highly-developed technological infrastructure in transportation, telecommunications and energy
5.2- Well-developed and low-cost sea transport facilities
5.3- Railway transport advantage to Central and Eastern Europe
5.4- Well-established transportation routes and direct delivery mechanism to most of the EU countries

6. CENTRALLY LOCATED
6.1- A natural bridge between both East-West and North-South axes, thus creating an efficient and cost-effective outlet to major markets
6.2- Easy access to 1.6 billion customers in Europe, Eurasia, the Middle East and North Africa
6.3- Access to multiple markets worth USD 24 trillion of GDP

7. ENERGY CORRIDOR AND TERMINAL OF EUROPE
7.1- An important energy terminal and corridor in Europe connecting the East and the West
7.2- Located at a close proximity of more than 70 percent of the world’s proven primary energy reserves, while the largest energy consumer, which is Europe, is located right to the west of Turkey, thus making the country a linchpin in energy transit and an energy terminal in the region

8. LOW TAXES & INCENTIVES
8.1- Corporate Income Tax reduced from 33 percent to 20 percent
8.2- Tax benefits and incentives in Technology Development Zones, Industrial Zones and Free Zones, including total or partial exemption from Corporate Income Tax, a grant on employer’s social security share, as well as land allocation
8.3- R&D and Innovation Support Law
8.4- Incentives for strategic investments, large-scale investments and regional investments

9. CUSTOMS UNION WITH THE EU SINCE 1996
9.1- Customs Union with the EU since 1996 and Free Trade Agreements (FTA) with 27 countries (Ministry of Economy)
9.2- More FTAs underway
9.3- Accession negotiations with the EU

10. LARGE DOMESTIC MARKET
10.1- 48.6 million broadband internet subscribers in 2015, up from 0.1 million in 2002 (ICTA, TurkStat)
10.2- 73.6 million mobile phone subscribers in 2015, up from 23 million in 2002 (TurkStat)
10.3- 58 million credit card users in 2015, up from 16 million in 2002 (The Interbank Card Center of Turkey)
10.4- 181 million airline passengers in 2015, up from 33 million in 2002 (TurkStat)
10.5- 35.6 million international tourist arrivals in 2015, up from 13 million in 2002 (TurkStat)

 Date: 13 March 2017

Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither MuhasebeNews nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.

1. Technology Development Zones – Techno parks
Technology Development Zones (TDZ*) are areas designed to support R&D activities and attract investments in high-technology fields.

There are 63 TDZs of which 50 are operational and 13 have been approved and are currently under construction.

1.1. Advantages of TDZs

• Profits derived from software development, R&D, and design activities are exempt from income and corporate taxes until December 31, 2023.
• Sales of application software produced exclusively in TDZs are exempt from VAT until December 31, 2023. Examples include software for systems management, data management, business applications, and different business sectors, the internet, mobile phones, and military command control.
• Wages of R&D, design and support personnel employed in the zone are exempt from all taxes until December 31, 2023. The number of the support personnel covered by the exemption cannot exceed 10 percent of the number of the R&D personnel.
• Investments for the production of the technological products obtained as a result of the R&D projects conducted in the zone may be made in the TDZ if deemed suitable by the operator company and allowed by the Ministry.
• 50 percent of the employer’s share of the social security premium will be paid by the government until 31.12.2023.
• Customs duty exemption for imported products and stamp duty exemption for applicable documents within the scope of R&D, design, and software development projects.2. Organized Industrial Zones
  Organized Industrial Zones (OIZ*) are designed to allow companies to operate within an investor-friendly environment with ready-to-use infrastructure and social facilities. The existing infrastructure provided in the zones includes
• roads,
• water,
• natural gas,
• electricity,
• communications,
• waste treatment, and other services.
  There are 284 OIZs in 80 provinces, 215 of which are currently operational, while the remaining 69 OIZs are being constructed throughout Turkey.2.1. Advantages of OIZs
  In addition to the investment incentives scheme in Turkey (general investment incentives, regional investment incentives, large-scale investment incentives, strategic investment incentives, employment incentives, R&D support, etc.), investors operating in the OIZs can benefit from the following advantages:
• No VAT for land acquisitions.
• Exemption from real estate duty for five years starting after the construction of the plant.
• Low water, natural gas, and telecommunication costs.
• For unification and/or separation of plots, no tax to be paid. Exemption from municipality tax for construction and usage of the plant.
• Exemption from the municipality tax on solid waste if the OIZ does not benefit from the municipality service.
  
  3. Free Zones
  Free zones (FZ) are special sites considered to be outside the customs area, although they are within the political borders of the country. These zones are designed to increase the number of export-focused investments. Legal and administrative regulations in the commercial, financial, and economic fields that are applicable within the customs area are either not implemented or partially implemented in the free zones.There are 19 FZs in Turkey located close to the EU and Middle Eastern markets adjacent to major Turkish ports on the Mediterranean, Aegean Sea, and the Black Sea, with easy access to international trade routes.

3.1. Advantages of FZs

• 100% exemption from customs duties and other assorted duties.
• 100% exemption from corporate income tax for manufacturing companies.
• 100% exemption from value-added tax (VAT) and special consumption tax.
• 100% exemption from stamp duty for applicable documents.
• 100% exemption from income tax on employees’ wages (for companies that export at least 85% of the FOB value of the goods they produce in the free zones).
• Goods can remain in free zones for an unlimited period.
• Companies are free to transfer profits from free zones to abroad as well as to Turkey, without restrictions.

 Date: 13 March 2017

Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither MuhasebeNews nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.